Pearlman sues associates over modeling agency

ORLANDO (AP) -- Boy band music mogul Lou Pearlman has sued former business associates who convinced him to take control of a controversial modeling agency.

Pearlman said in the $100 million lawsuit that he was misled about the scouting network's operations as well as the backgrounds of some of the people involved with the company, previously known as Wilhelmina Scouting Network.

The goal of the lawsuit is to convince people that he never knew what he was getting into when he became involved with the scouting network last year, not to collect the $100 million damages, Pearlman said.

"I've gotten beat up too much," Pearlman said. "Now it's time that I fight back to save my face."

The lawsuit, filed earlier this month, names 10 defendants, including Ayman El-Difrawi and Ralph Edward Bell. They are two of the three "principals" behind the 2001 creation of the model scouting network, according to documents filed by the company with the Securities and Exchange Commission.

El-Difrawi has an unlisted phone number and could not be reached for comment. Bell would not comment on the suit, saying he was "vaguely aware of it."

The scouting network has been accused of using questionable sales tactics.

The Florida Attorney General's Office has been investigating the scouting network for more than a year. More than 1,500 consumers and former workers have complained of misrepresentation and deceptive advertising.

Pearlman and associate Gregory McDonald, president of Pearlman's Trans Continental Records, agreed in September 2002 to acquire 51 percent of the scouting network, which operates a Web site where aspiring models and actors can be seen by modeling agencies, casting directors and such.

Pearlman recently began to phase out the company's scouting operations, which are handled by 57 national and international offices, each owned by franchisees. The company will no longer offer any support to those offices, he said Wednesday.

We are out of the scouting business," he said.

The company will continue to offer its Web site but is shifting its focus to conventions where aspiring models, actors and musicians compete for contracts and industry exposure, Pearlman said.

Pearlman also said he may pursue a recision of the September 2002 deal that put him in control of the company in the first place.

Such a move, he said, would eliminate his stake in the company.

"It would be as if I were never chairman," Pearlman said. "And we could take our name back."